in the district court of appeal - Florida Supreme Court

in the district court of appeal - Florida Supreme Court

IN THE SUPREME COURT OF THE STATE OF FLORIDA CASE NO. SC 11-1149 LOWER COURT CASE NO.: 3D09-2342 WILLIAM P. WALKER III, and GEMMA M. WALKER, his wife...

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IN THE SUPREME COURT OF THE STATE OF FLORIDA CASE NO. SC 11-1149 LOWER COURT CASE NO.: 3D09-2342

WILLIAM P. WALKER III, and GEMMA M. WALKER, his wife, Plaintiffs/Petitioners, vs. JAIME A. FIGAROLA, Defendant/Respondent ______________________________/

RESPONDENT’S AMENDED BRIEF ON JURISDICITON

John H. Schulte, Esq. Florida Bar No. 0100229 121 Alhambra Plaza Suite 1500 Coral Gables, Florida 33134 Tel: (305) 779-5660 Fax: (305) 779-5623 Attorneys for Respondent Jaime A. Figarola

TABLE OF CONTENTS TABLE OF CITATIONS………………………………………………3 STATEMENT OF THE CASE AND OF THE FACTS.......................4 SUMMARY OF ARGUMENT...............................................................4 ARGUMENT……………………………………………………………5 I. THE THIRD DISTRICT SET OUT THE LAW IN FLORIDA THAT A SIMPLE MONETARY DEBT GENERALLY CANNOT FORM THE BASIS OF A CLAIM FOR CONVERSION OR CIVIL THEFT. CONCLUSION………………………………………………………...9 CERTIFICATE OF SERVICE……………………………………………………………....10 CERTIFICATE OF COMPLIANCE………………………………………………………..10

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TABLE OF CITATIONS I.

Cases

Belford Trucking Co. v. Zagar, 243 So.2d 646 (Fla. 4th DCA 1970)…………………………………...6 Futch v. Head, 511 So. 2d 314 (Fla. 1st DCA 1987).................................................................................6 Gasparini v. Pordomingo, 972 So.2d 1053 (Fla. 3d DCA 2008)......................................................4, 6, 7 Ginsberg v. Lennar Fla. Holdings, Inc., 645 So.2d 490 (Fla. 3d DCA 1994).........................................................8 Hotels of Key Largo v. RHI Hotels, Inc., 694 So.2d 74 (Fla. 3d DCA 1997)............................................................5, 8 HTP, Ltd. v Lineas Aerea Costarricenses, S.A., 685 So.2d 1238 (Fla. 1996).......................................................................5, 8 Huron Tool & Engineering, Co., v. Precision Consulting Services, Inc., 532 N.W. 2d 541, 545 (Mich. 1995)…………………………………....5, 8 Indemnity Insurance Co. of North America v. American Aviation, Inc., 891 So.2d 532 (Fla. 2004)……………………………………………….8 Masvidal v. Ochoa, 505 So.2d 555 (Fla. 3d DCA 1987)..........................................................6 Walker v. Figarola, 59 So. 3d. 188 (Fla. 3d DCA 2011)…………………………………….4, 5, 6, 8, 7, 9

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STATEMENT OF THE CASE AND OF THE FACTS Respondent adopts Petitioners’ Statement of the Case and of the Facts except to point out that the Petitioners left out that part of the District Court’s decision which reiterated the case law that in order for there to be a claim for conversion where money is involved, “there must be an obligation to keep intact or deliver the specific money in question, so that money can be identified.” Walker v. Figarola, 59 So. 3d 188, 190 (Fla. 3d DCA 2011) (citing Gasparini v. Pordomingo, 972 So. 2d 1053, 1056 (Fla. 3d DCA 2008)) and its holding that “To establish a claim for civil theft, a party must prove that a conversion has taken place and that the accused party acted with criminal intent.” Id. 1 SUMMARY OF ARGUMENT The decision of the district court is in line with the law in Florida that a simple obligation to pay money cannot be converted into a claim for conversion or civil theft or a claim for misrepresentation and “[t]o establish a claim for civil theft, a party must prove that a conversion has taken place and that the accused party acted with criminal intent.” Gasparini v. Pordomingo, 972 So. 2d 1053,

In footnote 1 of Petitioners’ Brief on Jurisdiction state that they do not base their petition on the court’s ruling that there was no conversion which would assume their acceptance of the cases cited by the District Court as holding that where there was no identifiable fund there can be neither conversion nor civil theft.

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1056 (Fla. 3d DCA 2008). There was admittedly no conversion. id. The district court was also correct in it reliance on Hotels of Key Largo v. RHI Hotels, Inc., 694 So. 2d 74, 77 (Fla. 3d DCA 1997) which follows the Supreme Court’s opinion in HTP, Ltd. v Lineas Aerea Costarricenses, S.A., 685 So.2d 1238, 1240 (Fla. 1996) for the law that there can be no independent tort where the alleged misrepresnation relates to the performance of a contract adopting the rule from Huron Tool & Engineering, Co., v. Precision Consulting Services, Inc., 532 N.W. 2d 541, 545 (Mich. 1995). There is no conflict between the districts or with any decision of this court so that jurisdiction should be declined. ARGUMENT I. THE DISTRICT COURT SET OUT THE LAW IN FLORIDA THAT A SIMPLE MONETARY DEBT GENERALLY CANNOT FORM THE BASIS OF A CLAIM FOR CONVERSION OR CIVIL THEFT, The Petitioners position is that their Second Amended Complaint (“SAC”) pled a claim for “civil theft,” which alleged: [T]hey [the Walkers] loaned Figarola $25,000 based on an oral promise to repay the loan within three weeks; at the time Figarola made the promise, he had no intention of repaying the loan, and the loan remain unpaid and the money the Walkers loaned Figarola was converted to Figarola’s own use. In affirming the trial court’s grant of a judgment on the pleadings, the District Court set out in its opinion that: “[t]he law in Florida is clear—a simple monetary

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debt generally cannot form the basis for conversion of civil theft.” Walker v. Figarola, 59 So. 3d. 188, 190 (Fla. 3d. DCA 2011) (citing Gasparini v. Pordomingo, and the cases cited therein from the other district courts of appeal in Florida). The law as set out by the District Court below and in Gasparini is that the “the civil theft or conversion must go beyond, and be independent from, a failure to comply with the terms of a contract.” Gasparini, 972 So. 2d at 1055. The Gasparini court also held that: “To establish a claim for civil theft, a party must prove that a conversion has taken place and that the accused party acted with criminal intent.” Id. at 1056. Here, the District Court held that “[f]irst, in order for the there to be a conversion where money is involved, ‘there must be an obligation to keep intact or deliver the specific money in question, so that money can be identified.’” Walker, 59 So. 3d at 190 (quoting Gasparini, 972 So. 2d at 1056) (quoting Futch v. Head, 511 So. 2d 314, 320 (Fla. 1st DCA 1987) (quoting Belford Trucking Co. v. Zagar, 243 So.2d 646, 648 (Fla. 4th DCA 1970)). The District Court also cited Masvidal v. Ochoa, 505 So. 2d 555 (Fla. 3d DCA 1987) (“specifying that conversion and civil theft can be asserted where a party embezzles from an escrow account”). The District Court noted that the SAC reflected that the $25,000 loaned by the Walkers to Figarola was not to be kept in a separate account or escrow account so that there could not be a conversion as a matter of law.

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The Petitioners do not challenge the District Court’s holding that their complaint failed to state a cause of action for conversion, see Pet. Brief at 2 n.1, which under the law of Florida, as set out in Gasparini, would foreclose a claim for civil theft “as a matter of law.” Gasparini, 972 So. 2d at 1056. There is an unbroken phalanx of state and federal decisions which have held that “[t]o establish a claim for civil theft, a party must prove that a conversion has taken place and that the accused party acted with criminal intent” id. (emphasis added), as the law in Florida, which are too numerous to cite. The District Court’s opinion below is also consistent with the law in Florida as announced in Gasparini, to wit: [T]his is not to say that there can never be a claim for civil theft or conversion if there is a contractual relationship between the parties, but rather that the civil theft or conversion must go beyond, and be independent from, a failure to comply with the terms of a contract. 972 So. 2d at 1055 (emphasis added). Even assuming that the Petitioners could overcome the failure of their cause of action for conversion, their civil theft claim must also fail on its own allegations. The allegation that the Defendant “had no intention of repaying the loan” is not beyond and independent from the failure of the Defendant to repay the loan as promised so as to support a claim for conversion or civil theft. The allegation that the Defendant never intended to repay the loan goes to his performance or non-performance of the contract and is not independent

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from the contract itself. The District Court, Walker, 59 So. 3d at 191, correctly stated the law as it set out earlier in Hotels of Key Largo v. RHI Hotels, Inc., 694 So. 2d 74, 77 (Fla. 3d DCA 1997): “Misrepresentations relating to the breaching party's performance of a contract do not give rise to an independent cause of action in tort.” This reasoning in turn follows faithfully this Court’s statement of the law in HTP, Ltd. v Lineas Aerea Costarricenses, S.A., 685 So.2d 1238, 1240 (Fla. 1996) adopting the law as set out in Huron Tool & Engineering, Co., v. Precision Consulting Services, Inc., 532 N.W. 2d 541, 545 (Mich. 1995): The distinction between fraud in the inducement and other kinds of fraud is the same as the distinction . . . between fraud extraneous to the contract and fraud interwoven with the breach of contract. With respect to the latter kind of fraud, the misrepresentations relate to the breaching party's performance of the contract and do not give rise to an independent cause of action in tort. In addition, this Court in Indemnity Insurance Co. of North America v. American Aviation, Inc., 891 So. 2d. 532, 536 (Fla. 2004) also cited with approval Ginsberg v. Lennar Florida Holdings, Inc., 645 So. 2d. 494–95 and set out its quote: “Where damages sought are the same as those for breach of contract a plaintiff may not circumvent the contractual relationship by bringing an action in tort.” The Third District’s reliance on the quoted language is not in conflict with this Court’s precedent. Petitioners have failed to cite one case in Florida which recognizes an intentional or criminal breach of contract to repay a loan of money entitling the 8

lender to extra-contractual tort or statutory remedies. The District Court in its opinion succinctly stated: “[Plaintiffs] cannot now seek a remedy in tort for a debt which could have been discharged by the payment of money by simply alleging that [Defendant] never intended to keep his promise to repay the debt.” See Walker, 188 So. 3d at 191. Petitioners cite to no authority within the state to the contrary. The District Court also pointed out that it was after Petitioners’ breach of contract claim for money lent was dismissed because of the four-year statute of limitations that the complaint was amended and labeled simply a civil theft claim in order give it a five-year statute of limitations. CONCLUSION The decision by the Third District in Walker v. Figarola is not in conflict with any decision of this Court nor any other District Court. The Court should decline to exert its discretionary jurisdiction. John H. Schulte, Esq.

_____________________ Florida Bar No. 0100229 121 Alhambra Plaza Suite 1500 Coral Gables, Florida 33134 Tel: (305) 779-5660 Fax: (305) 779-5623 Attorneys for Respondent Jaime A. Figarola

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CERTIFICATE OF SERVICE I CERTIFY that a copy of the foregoing has been served by U.S. Mail to Arthur J. Morburger, Esq., Suite 404 Biscayne Building, 19 West Flagler Street, Miami, Florida 33130, Tel. (305) 374-3373; and Robert I. Spiegelman, Esq., 912 Biscayne Building, 19 West Flagler Street, Miami, Florida 33130, Tel. (305) 3712500, attorneys for Appellants, this 30th day of June 2011. ________________________ Attorney

CERTIFICATION OF FONT SIZE AND TYPE The undersigned counsel hereby certifies that the font size and type contained in this Answer Brief is fourteen point Times New Roman. _________________________ Attorney

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